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EUR/GBP Technical Analysis: Euro Slides to 2-Month Low

EUR/GBP Technical Analysis: Euro Slides to 2-Month Low

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Talking Points:

  • EUR/GBP Technical Strategy: Short at 0.7325
  • Euro Selloff Accelerates Anew After Corrective Bounce Fails to Build Momentum
  • Short Trade Active, Looking for Downside Follow-Through Beyond 2-Month Low

The Euro resumed its decline against the British Pound after a meek attempt to launch an upside correction failed to generate momentum. Prices turned lower as expected after putting in a bearish Dark Cloud Cover candlestick pattern, breaking rising trend support guiding the move higher from mid-July lows.

Near-term support is now at 0.7126, the 38.2% Fibonacci expansion. A break below that on a daily closing basis opens the door for a challenge of the 50% level at 0.7088. Alternatively, a reversal back above the 23.6% Fib at 0.7173 – now acting as resistance – clears the way for a test of the 14.6% expansion at 0.7203.

We sold EUR/GBP at 0.7325 and have since booked gains on half of the trade. The remainder of the position remains open to capture any further weakness ahead. The stop-loss has been adjusted to the breakeven level.

Losing Money Trading Forex? This Might Be Why.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.